UPS package deliveryFriday's fourth-quarter GDP numbers offered more evidence that the economy is picking up steam, but one of the biggest obstacles to the recovery remains the stubbornly high unemployment rate. We'll find out whether there has been any movement on that front when employment data for January comes out this week, with Challenger job cut report and ADP employment data both due Wednesday, and the government's unemployment rate on Friday. Another mild increase in jobs is expected, in line with the three-month average, but not enough to significantly reduce the unemployment rate.

Also look for the ISM manufacturing and nonmanufacturing indexes this week, as well as the Chicago purchasing managers' index and the New York NAPM index. And Fed Chairman Ben Bernanke will speak to the National Press Club on Thursday.

The earnings season rolls on, too. Here's a peek at what analysts polled by Thomson Reuters expect from quarterly reports this week, with a closer look at economic bellwether United Parcel Service (UPS), as well as Coinstar (CSTR) and Las Vegas Sands (LVS), anticipated to be two of the week's big earnings winners.

Companies expected to post double-digit earnings growth from a year ago are plentiful. They include Aetna (AET), Aflac (AFL), Ameriprise (AMP), Avery Dennison (AVY), BP (BP), Broadcom (BRCM), Constellation Energy (CEG), Cummins (CMI), Dow Chemical (DOW), Electronic Arts (ERTS), Estee Lauder (EL), Goodrich (GR), Marathon Oil (MRO), MasterCard (MA), Novellus (NVLS), Sony (SNE), Tyson Foods (TSN), Visa (V), Whirlpool (WHR) and Yum! Brands (YUM).

United Parcel Service

The world's largest package-delivery company boosted rates for 2011 and sold its logistics technologies unit during the fourth quarter. Analysts forecast earnings for the period to come to $1.05 per share, up from 75 cents per share in the same quarter of last year. The Atlanta-based company also is expected to post revenues of $13.4 billion for the three-month period that ended in December, which is 8.3% more than a year earlier.

For the full year, analysts expect to see earnings of $3.53 per share (up 34.6%) on revenue of $49.6 billion (up 9.4%). UPS earnings were better than expected in recent quarters, beating estimates by as much as 13 cents per share.

UPS has a long-term EPS growth forecast of 11.7% and forward price-to-earnings ratio of 17.7, but that's much less than the industry average. Its PEG ratio is 1.5, and the dividend yield is 2.6%. The First Call consensus recommendation remains to buy UPS. The mean price target is $83.13; Piper Jaffray raised its target to $88 last week. Shares have traded around $73 since mid-December, but closed the week at $70.73.


Analysts anticipate that this coin-counting and DVD-rental kiosk operator will report Thursday that its fourth-quarter earnings surged 73.5% year-over-year to 68 cents per share. Coinstar appointed a chief performance officer and launched a holiday promotion during the three-month period that ended in December, and revenue for the quarter is predicted to total $393.3 million, an annual increase of 19.9%.

The full-year forecast calls for per-share earnings of $2.03 (up 61.6%) and $1.4 billion in revenue (up 25.7%). In the past few quarters, earnings have topped consensus estimates -- by 15 cents per share in the third quarter.

Coinstar's long-term EPS growth forecast is 24.2%. Its forward P/E of 15.5 is less than the trailing P/E, meaning it it's seen as a better bargain. The PEG ratio is 0.6. Analysts on average recommend buying CSTR, and their mean price target is $57.38. Shares tumbled earlier this month following weaker-than-expected guidance and have traded around $42 since.

Las Vegas Sands

Las Vegas Sands may be the week's biggest winner in terms of earnings growth. During the three months that ended in December, the resort/convention center operator signed an agreement with Intercontinental Hotels (IHG) and saw its S&P credit rating raised. The Las Vegas-based company is expected to post earnings of 39 cents per share. That's a year-over-year jump of 92.3%, and analysts are also looking for a 60.9% increase in revenue to $2.1 billion.

Wall Street foresees full-year earnings of 98 cents per share (up 92.6%) on revenue of $6.9 billion (up 51.1%). Earnings have grown sequentially over the past year, topping estimates by as much as a dime per share.

The 64.2% long-term EPS growth forecast leaves that of competitor MGM Resorts (MGM) in the dust. The forward P/E is 28.4, but that's well down from the trailing P/E of 77.2. The PEG ratio is 0.4. Short interest dropped off in the past quarter but remains about 5% of the float. Analysts' consensus recommendation is to buy LVS and their mean price target is $52.88. Las Vegas Sands is expected to be the top casino stock in 2011. After rising steadily for most of last year, the share price has bounced between $42 and $52 since November.

Other Earnings Outlooks

Analysts are looking for more modest earnings growth from Gannett (GCI), Hospira (HSP), Kellogg (K), Mattel (MAT), Merck (MRK), NASDAQ OMX (NDAQ), Reynolds American (RAI), Thermo Fisher (TMO) and Time Warner (TWX).

Year-over-year earnings declines are predicted for Archer Daniels Midland (ADM), Cigna (CI), Clorox (CLX), Diamond Offshore Drilling (DO), Hershey (HSY), New York Times (NYT), Pfizer (PFE), Starwood Hotels (HOT) and Toyota (TM).

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Our socialist public educational system has indoctrinated our children into believing capitalism and freedom is bad and socialism is good. If Socialism is so good, why does the long time socialist government of Mexico boast of being the #1 producer of silver, plenty of oil, and the richest man in the world, yet 99% of their people are in the poverty level making an average of less than 6 dollars a day. Corruption is rampant. The evil, ultra rich see Mexico and want to implement socialism here, where they can have all of the wealth and power and the middle class will now be among the poor. That is what their Demoncrat puppets in the white house and senate are doing to us.

January 31 2011 at 11:13 AM Report abuse +1 rate up rate down Reply
metter's world

News of the week: unemploymnet stays at 9% level for the longest time since great depression-however liberal media says Obama truly is a great man because he realizes businesses create jobs, not him.

January 30 2011 at 8:41 PM Report abuse +2 rate up rate down Reply

Abolish Capital Gains (Investment) Taxes and lower the Corporate Tax rate by
50 %, BOOM, America goes back to work and manufacturing jobs grow, with the economy growing then Social Security fixes itself.............Medicare must give
up benefits if we are to continue as a Nation, Healthcare is now 15 % of GDP
when it should be half that abolish all the expensive medical
benefits like transplants, hip/joint surgery, major end of life stuff, etc. for
about $ 500 Billion in additional cost savings. End the Wars, abolish Education,
HUD and Dept. of Agriculture and VIOLA ! THE USA IS IN THE PINK AGAIN !

I am an old Guy, I do not expect nor want expensive medical to keep me going, there comes a time to just wait for Heaven !

January 30 2011 at 4:05 PM Report abuse +2 rate up rate down Reply

Wall st. has the audacity have you believe there is a healthy jobless recovery taking place right now ....Yes America ...thats how DUMB they think you are!

January 30 2011 at 3:40 PM Report abuse +3 rate up rate down Reply